Obelisk SC1 Slim Gen-2 SIA Miner – SCAM or Hidden GEM?

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Obelisk, an ASIC manufacturer founded by SIA Storage, announced a new batch of SC1 Slim miners for sale. Here’s the catch. According to the official website, virtually nobody buys these units lately. Does that mean that the units are not worth it or are we about to find a hidden gem? Let’s find that out.

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  1. Is Mining SIA a Good Idea?

The first reason why people might not want to buy an ASIC is because the coin it is made to mine is dead. Could this apply to SIA?

As for today, SIA is a coin with a $86,572,943 USD market cap and a $793,575 USD daily volume. While these past 12 months haven’t been too forgiving for the coin (it has been a pretty rough time for most cryptos to be honest), SIA is definitely not a small coin, neither does it look like one that is dying. In fact, SIA is ranked #50 on CoinMarketCap.

Even though it has pretty decent competency, SIA is the biggest fish in the pool with MaidSafe being ranked #65, Storj #129 and Filecoin #1774. All of the mentioned coins have similar market situation too (just on different scales), which means that SIA will probably remain in the leading position for as while (though this is mere speculation based on numbers).

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  1. Are Obelisk SC1 Units Profitable?

The second thing that usually makes people to avoid buying an ASIC is when the global network hashrate of that specific coin is overly saturated and the new units don’t hash well enough to be profitable. Most big coins have this problem and since SIA isn’t exactly small, maybe this is its case too?

The answer is no. Every board in a new SC1 Slim hashes 600 GH/s on average, while the network hashrate is 1.6 PH or 1,600,000 GH. This means that every SC1 Slim board produces 1/2,500 part of the global network hashrate. As a comparison, the popular Antminer D3 produces 1/133,333 parts of the global hashrate for Dash. In fact, Obelisk SC1 Slim is the fifth most profitable ASIC according to ASICMinerValue, with other two Obelisk SIA ASICs taking the first and second spots in the global leaderboard.

This used to be different before the hard fork that happened November 1, 2018. Back in the day, Bitmain and Innosilicon miners kept SIA network hashrate 100x times higher than it is now. Then, the hard fork bricked (made incompatible with SIA algo) all of those units, leaving only Obelisk SC1 units untouched.

This leads us to our next question: Maybe people don’t trust Obelisk?

  1. Is Obelisk the Problem?

Unfortunately for the company, Obelisk does not have a flawless track record. The SC1 was the company’s first ASIC and as expected for a fresh company, Obelisk miscalculated the shipment dates. As a result, the company delayed the shipment of their first two batches of SC1 miners by few months, which caused a lot of anger in the mining community.

While the outrage is perfectly understandable, part of the community also understand that Obelisk hasn’t scammed their customers per se. Batch 1 units were delivered and are hashing as advertised, and now Batch 2 units are being shipped too. The company kept a constant contact with their customers and even announced a compensation plan to make up for the monetary losses their customers had to face for not mining all these past months.

I understand that unlike Bitmain or Innosilicon, Obelisk is a new company that has to figure a lot of things out. One glance at their updates is enough to realize that the company has still a lot of things to polish – they face a lot of unexpected challenges and they have to find solutions on the go. Obelisk is a new company and personally I don’t expect them to instantly become as fail-proof as, say, Bitmain.

SIA Fork and Obelisk Monopoly?

Some of the people who forgave Obelisk for the shipment delay (after all, the compensation plan should make up for the financial losses too) are still hesitant to trust Obelisk because of the recent hard fork they’ve made.

You see, SIA is a for-profit project led and developed by Nebulous, which also happens to be the company behind Obelisk. The two companies are so closely related that their names are pretty much interchangeable.

This means that now after the hard fork, Nebulous is the only company producing ASICs for their own coin. Smells like monopoly and centralization, right?

I have made an in-depth analysis of the whole situation here.

So basically what happened was – Innosilicon was actively amplifying their SIA mining farms – three weeks prior to the fork Innosilicon owned 37% of global SIA mining hashrate, a week before the fork they owned 43% of the global hashrate. The company was steadily and quickly making it to the so-feared 51%. Once having 51%, Innosilicon would pretty much make SIA mining centralized.

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David Vorick, the owner of Nebulous, was probably thinking: “SIA, a project that is is all about decentralization, is now about to become centralized thanks to Innosilicon. Innosilicon could have sold its miners to the public to prevent mining centralization but for some reason it decided to pile those miners up in its huge mining farm. We have to stop that.”

Are the Obelisk SC1 Gen-2 Miners Good, then?

All of the above makes me conclude that there is still a lot of negative bias towards Obelisk. If Obelisk is a monster who only wants monopoly and money then you obviously don’t want to buy a miner from them.

However, Obelisk proved to be a pretty transparent and honest company so far:

  • They had a legitimate reason to fork
  • Their units hash as advertised
  • They are planning to compensate their customers for the delay

That, combined with the fact that SIA is a pretty solid coin and that now the low network hashrate made the Obelisk SC1 units profitable again, does that mean that we should all rush and buy our SC1 gen-2 units?

I have no idea. The main reason being that I can’t endorse a piece of hardware I haven’t tested myself. It can be look amazing on paper but I’m not here to tell you guys “hey this ASIC kinda looks good go buy it!”. I can criticize an ASIC that looks bad even on paper without owning one myself, however if I want to recommend something, I have to have the unit in hands.

Gigabyte, AsRock, Canaan, Rebtech, HashAltcoins and others know it, which is why they take the risk and send me samples for me to test and review. Luckily for all of us, so far all of the products I have received from them were good and worth a recommendation. No matter how much I like Obelisk, I won’t make an exception for them.

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In Conclusion

If I ever receive a unit from Obelisk, I will make sure to make a detailed review for you guys. For now though, I will limit myself with this review of the situation surrounding the Obelisk SC1 miner and the company that manufactures it. Some people get scared away by the hardfork and Obelisk’s motivations, and then they further lose trust when they go to Obelisk’s website and see the huge dip in SC1 unit sales.

Obelisk seems like a transparent company to me and I even have some sympathy towards them. Some people can’t tell a mistake from malicious intent apart, which is why they labeled Obelisk as scammers. While I understand their position, I still believe that the company is often misjudged.

That being said, what are your thoughts on it? Please let me know in the comments section below:

Thank you for reading. As always, your comments, suggestions and questions are welcome.

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